The liver constitutes one of the few, normally-quiescent tissues in the adult body that has the capacity to regenerate. As a result, it provides a unique, multi-cellular, physiologically normal system in which to study the mitogenic response of epithelial cells. Previously, we identified more than 40 novel immediate-early and delayed-early genes activated during liver regeneration. Immediate-early or primary response genes many of which encode proto-oncogenes have been shown to have important effects on cell growth and differentiation. Of the genes we identified, PRL-1 is particularly interesting, because it is the only gene that is induced at a high level in regenerating liver, but is constitutively expressed in insulin-treated rat H35 hepatoma cells which otherwise show normal regulation of immediate-early genes. It is a liver-enriched immediate- early gene because its induction is much higher in the regenerating liver than in other mitogen activated cells. We reasoned that PRL-1 could have important effects on growth of hepatic cells. Initial studies revealed that PRL-1 encodes a unique protein tyrosine phosphatase (PTPase) with no homology to other PTPases outside the active site. In cells, PRL-1 migrates as a 21 kD protein, and is located primarily in the triton- insoluble fraction of the cell nucleus. Stably transfected cells which overexpress PRL-1 demonstrate altered cellular growth and morphology, and a transformed phenotype. Other PTPases have been shown to have important effects on cellular growth control. PTPases such as cdc25 and MKP-1 have very specific intracellular substrates, cdc-2, Map kinase, respectively, thus establishing their importance in cell growth control. Thus far, Dr. Taub's laboratory has not identified specific intracellular targets for the PRL-1 phosphatase. However, like other PTPases, PRL-1 may be important in normal cellular growth in liver regeneration and other cells in which it is expressed, and could contribute to the tumorigenicity of hepatomas and other cancer cells. We have two major goals in this proposal. We will demonstrate the importance of PRL-1 in hepatic and cell growth by more carefully defining its expression patterns in animals, and modulating its expression in the 3T3 and H35 (liver) cell lines and animals. We will learn more about the specifics of PRL-1 function by characterizing interacting proteins, and identifying specific intracellular substrates. Ultimately these two goals will merge and allow us to define precisely how PRL-1 functions to regulate hepatic growth during development and regeneration, and contributes to oncogenesis in liver tumors. We will accomplish these goals by (1) more precisely defining the expression of PRL-1 in liver regeneration, fetal and adult tissues; (2) testing the specific effects of PRL-1 on cell growth and oncogenesis by carefully regulating PRL-1 expression in transfected 3T3 and H35 cells and liver cells of transgenic animals; (3) identifying the cellular substrates of PRL-1 by characterizing PRL-1 associated proteins, expression cloning and testing candidate substrates; and (4) characterizing potential members of the PRL-1 gene family through homology cloning.